As a member of the project team responsible for defining the financial closing process, you need to define the types and timing of the closing activities that need to be performed in the SAP system. True False.
Periodic Closing Process: The pre-closing activities that occur on the last day of previous month are as follows: Technical – Open a new accounting period in Financial Accounting (FI), close the previous month in Materials Management (MM), close sub ledgers in FI, and perform a preliminary close of general ledger (G/L) in FI. FI – As part of pre-closing activities, enter accruals and deferrals, process recurring entries, and process bad debt expenses in Accounts Receivable (AR). MM – Maintain the goods receipt and invoice receipt (GR/IR) clearing account and post material revaluations. Human Resource (HR) – Post payroll expenses. Sales and Distribution (SD) – Post goods issues for deliveries to customers. Close CO area.
Periodic Closing Process: The managerial closing activities are which of the following: Perform Controlling (CO) allocations and reposting. Lock the old accounting period. Reopen the G/L for adjustment postings. Reopen special period.
Periodic Closing Process: The closing activities for external reporting purposes are as follows: FI – Perform valuations of open items in foreign currency. Technical – Close the previous period. FI/CO – Create document reports like tax reports, asset history sheet for external reporting, and managerial reports for internal purposes.
For the final period of the fiscal year, in addition to the regular month-end closing activities, year-end closing activities are performed. The pre-closing activities that begin in the old month are as follows: Technical – Open the first accounting period of the new fiscal year in FI and perform fiscal year change in Asset Accounting (AA) and balance carry forward in FI MM – Perform a physical inventory count (may be performed on up to a monthly basis). Production Planning (PP)/CO – Update product cost estimates (may be performed more frequently). MM – Perform lowest value determination and LIFO/FIFO valuation. AA – Perform asset valuations and investment support. SD-Perform sales & distribution transactions for previous month FI – Conduct balance confirmations for customers or vendors.
Year-End Closing Process: The closing activities for external reporting purposes are as follows: FI – GR/IR clearing account analysis, receivables and payables reclassification, reconciliation of prior year to new year, and other adjustment postings Technical – Final closing of the old period (accounts receivable and accounts payable (AR/AP) and G/L) FI/CO – Creating external and internal reports MM/PM-prior year adjustments.
the management closing activities include locking the old accounting period. True False.
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